Healthcare / Biotech Venture Capital?

Curious about what kind of candidates healthcare and biotech-focused VCs look for. It seems like many partners have a Ph.D or an MBA - how necessary is that? I'm certainly aware there isn't just one path.

For context, I am a graduating senior and deciding between three offers in MBB consulting, and BB healthcare investment banking (both at analyst level). I also have an opportunity to join a biotech startup instead. MBA or science master's degree are an option in the future! But the end goal is VC.

Comments (10)

 
Jun 28, 2018 - 1:46am

I'm bias as I'm in MC but to be honest I truly think MC would be better than IB for life science VC. Life science IB is great but the methods used are also used for other industries (with some variation) and little specific knowledge is required about the science itself. In MC you take on more roles and projects (strategy, marketing, finance, operations and regulatory/policy projects) so you learn about the industry from a wider and more complete perspective. Science degrees are a must but not necessarily advanced ones. Many positions advertise you need PhD OR MBA + experience but not both. What you do need is at least a BSc in a biomedical field.

 
Jun 28, 2018 - 10:43am

all the people I've talked to have a strong science background (PHDs and MDs) or have lots of work experience working in pharma. But all of them said you should have a science background if you want to move up in the ranks.

 
Sep 22, 2018 - 4:12pm

harden4mvp:

all the people I've talked to have a strong science background (PHDs and MDs) or have lots of work experience working in pharma. But all of them said you should have a science background if you want to move up in the ranks.

Is that just because having a credential gives credibility? The science behind drugs is so complicated that I find it hard to believe that having a PhD or an MD gives anyone enough scientific knowledge (and knowledge of market dynamics!) to be able to understand the products of an entire portfolio of companies.

 
Most Helpful
Sep 20, 2018 - 6:05pm

I worked in biotech VC straight out of an IB analyst position and currently do a decent amount of work with some of the better known biotech VCs (organizing events, helping them find deals, etc). Am Bay Area based.

Bottom line is these days you pretty much need a PhD, or to be incredible at networking. Most junior / mid level VCs I know, at least at top funds, not only have a PhD and often a postdoc, but have some experience in consulting, or in business roles at a large company. There are maybe 10 top tier early stage biotech funds, and they hire maybe 5 junior / mid level people (very different structure than a non-biotech hedge fund or PE fund). Look at Atlas Venture, Third Rock, 5AM Ventures, Flagship, Orbimed, Versant, ARCH -- they lead the most Series A deals and are the MBB / bulge bracket of the biotech VC world.

Some late stage biotech VC funds (Sofinnova, Longitude, Clarus) used to hire finance / consulting types without PhDs (I was one of them), but these days even they are skewing more towards PhDs, as the market generally is. And these funds now find themselves competing with Chinese investors (Chinese investors actually lead more Series B biotech deals than US biotech VCs, at least in the first 8 mo of 2018) and crossover funds (ie hedge funds / mutual funds that invest in the last private round and then anchor the IPO). And these groups also often hire PhDs

You may see opportunities with tech VCs who are trying to get into biotech. However they are all about networking / hustle and don't care too much about finance experience, and many of them are pretty new to biotech and don't compete for the top deals.

All of this results from a frothy and competitive biotech investing market. Biotech has become very hot and investors are increasingly focused on early-stage companies, which are basically science projects, and you are competing for jobs with tens of thousdands of PhDs who have 5-15 years of living and breathing science and are used to making $40-60K / year.

However, you are young, and there may well be a correction in the next few years, which will scare away a lot of the new money in biotech. In a market like that, there will be more attractive later stage opportunities and the pendulum will swing back towards finance skills being important. So for now, MBB consulting and BB HC banking would be really nice ways for you to learn about the space and develop your skills, and if the market swings, you're in a great position to pounce

Biotech startups can be hit or miss and I'd be extremely cautious in working for one (I've worked for a few and started a VC-backed biotech). The world of biotech startups is very have and have-not -- if you have a good management team, good investors and most importantly good science (which will attract good investors / mgmt) it can be the best experience of your life. However if you work at a company with an inexperienced team or some science that has holes in it you will wish you were in IB

https://www.baybridgebio.com/
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